Generally speaking, Minnesota law requires employers to provide workers’ compensation coverage for all employees.

But the law does allow employers to exclude certain types of employees from coverage, such as small business owners and their close relatives.

Following are the types of employees that are exempt from mandatory insurance coverage by Minnesota state law :

• Sole proprietorships and partnerships:
  Someone operating a business as a sole proprietor isn't required to get workers' compensation insurance for his or her spouse, parents or children working in the business, regardless of age or wage rate. However, the business owner would have to provide coverage for any other employees. Similarly, members of a partnership — such as a law firm — don't have to purchase coverage for themselves. If their spouses, parents or children are employed by the partnership, they’re not required to provide coverage for them either.
• Executive officers of a closely held corporation:
  A closely held corporation is one in which the capital stock is held by no more than 10 people and has had less than 22,880 hours of payroll in the preceding calendar year (January 1 to December 31). Executive officers of closely held corporations can be excluded from coverage if they are elected or appointed in accordance with the company's charter or bylaws and they own at least 25 percent of the capital stock of the corporation (exclusive of any stock owned by other family members). If executive officers qualify to be excluded from workers’ compensation coverage, their spouses, parents and children are also excluded if they work in the same business. Relatives within the third degree of kinship — such as uncles, nieces, siblings and grandchildren — can also be excluded, but to do so, the employer must file a written election with the Minnesota Department of Labor and Industry.
• Managers of limited liability corporations:
  A limited liability company (LLC) has some attributes of a corporation and others of a partnership. If an LLC has 10 or fewer members and has less than 22,880 hours of payroll in the preceding calendar year (January 1 to December 31) managers who own at least a 25 percent membership interest aren't required to purchase workers' compensation coverage for themselves. If managers qualify to be excluded from workers’ compensation coverage, their spouses, parents and children are also excluded if they work in the same business. As with executive officers, relatives of a manager within the third degree of kinship can also be excluded, but to do so, the employer must file a written election with the Minnesota Department of Labor and Industry.

Even if state law doesn't require workers' compensation coverage for certain individuals, a business can choose to cover them by notifying its workers' compensation insurer in writing.

If you find that you do need workers' compensation insurance, you can get a quote through our website.

If you’re considering whether you should get workers’ compensation insurance for yourself or someone who isn’t required to have coverage, check out the small business owners blog post on our WorkersCompEssentials website.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.